Eligible pension income includes qualified pension income
(see below) and, for taxpayers who are 65 or older in the year, the
following pension income:
life annuity payments from a superannuation or pension
plan, including life income funds (LIFs) and locked-in
retirement income funds (LRIFs)
payments from a RRIF, which includes life income funds (LIFs) and locked-in
retirement income funds (LRIFs) (and any reference to a RRIF always includes
spousal RRIFs)
annuity payments from an RRSP or from a deferred
profit sharing plan (DPSP)
certain payments on the termination or winding-up of a
DPSP
regular annuities and income averaging annuity
contracts (IAAC) reported in box 24 of a T4A or box 19
of a T5
In the Detailed
Canadian Tax Calculator, enter the non-taxable amount of the
foreign pension income as either eligible or qualified pension income.
Do not record the non-taxable portion in the calculator.
since tax year 2010, annuity payments from the Saskatchewan Pension Plan
(SPP), which is a voluntary locked-in defined contribution pension plan available to
Canadians in all areas, not just Saskatchewan.
The above types of eligible pension income and qualified pension income are eligible for pension
splitting. See also our Pension
Splitting article, which includes an additional 2 types of pension income as
eligible pension income for purposes of pension splitting only.
For taxpayers who are less than 65 for the entire
year:
life annuity payments from a superannuation or pension
plan
payments from a RRIF, or annuity payments from an RRSP
or from a DPSP, which have been received as a result of
the death of a spouse or common-law
partner
foreign pensions,
including US Social Security - the amount of foreign pension income that is
not deductible on line 25600.
since tax year 2010, life annuity payments from the Saskatchewan Pension
Plan (SPP)
Quebec Pension Splitting
The June 4, 2014 Quebec
Budget announced that taxpayers under 65 would no longer be able to
split pension income for provincial income tax purposes, as of January
1, 2014.
Foreign Pension Income
Foreign pensions which are reported on line 11500 of
your tax return qualify as eligible pension income, except
pension income that is tax-free in Canada because of a tax treaty
the portion of foreign pension which is tax exempt due
to a tax treaty, and can be deducted from income on line
25600 of the tax return
income from a U.S. individual retirement account
See Eligible Pension Income above for
how to record this in the Detailed Canadian Tax Calculator.
Tax Tip: If you have pension or annuity income which is reported
on line 11500 or 12900 of your tax return, it may qualify for the
pension income tax credit and for pension
splitting with your spouse.
Income Not Eligible for Pension Tax Credit
Income that does not qualify as pension income for the pension income tax
credit:
payments from salary deferral arrangements, retirement
compensation arrangements, employee benefit plans, or
employee trusts
non-taxable portion of foreign pension income
Also see the Canada Revenue Agency (CRA) web page on Line
31400 (line 314 prior to 2019) Pension income amount, which includes a section
where you can answer questions to determine if you are
eligible to claim the pension income tax credit.